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1/13/2014 @ 10:17AM5,049 views

Why Entrepreneurship Is A Must For New Retirees

Jacqueline Boatman spent 43 years working as an administrative assistant, legal secretary and executive legal assistant at some of Detroit’s major law firms and auto suppliers. When her employer moved to Chicago last summer, she elected not to relocate. At age 61, she decided it was time to pursue her “second-act” in business—Face Saver Cosmetics, a specialty cosmetics company she had been exploring as a hobby since 2004.

“Wanting to slow the appearance of my aging skin, I obtained an esthetician license at age 52 while my daughter was away at college,” explains Boatman. “My passion for skin care comes from a genuine desire to help others.”

For workers like Boatman who are close to retirement age, entrepreneurship is more than just a creative outlet or passion project. It may be the new necessity for a healthy, comfortable and financially-stable retirement.

“We found that many senior citizens are significantly underfunded and risk running out of money, especially since people are living longer than they used to and may need to support a two- or three-decade retirement,” says Mike Sante, managing editor of Interest.com.

Retirees rely on multiple sources of income including social security, 401(k) plans, pensions and IRAs. But as the average life expectancy in the U.S. continues to rise, seniors are more likely to deplete their retirement resources. The need for healthcare, for instance, is a major variable. While some older adults get by with few medical issues, others will need savings of hundreds of thousands of dollars.

A revenue-generating entrepreneurial project can help seniors navigate this rocky and unpredictable transition from the working world.

A Second Act Needs Preparation And Passion

Boatman started Face Saver Cosmetics as an online business. Her goal, however, was to grow the company into a full-time retail location.

“My strategy was to save enough money to float the business and cover personal living expenses,” Boatman explains. “I wanted to make sure I had sufficient funds without going into additional debt.”

Boatman spent nearly 10 years learning about her passion and becoming an expert in her chosen field.

“I discovered how important healthy skin was to looking and feeling good and could give you an edge in a competitive world,” says Boatman.

Then retirement gave Boatman access to a new asset that she never had while working a traditional job—time.

“I now have the time to invest in Face Saver Cosmetics and turn it into a profitable or even a franchise business,” says Boatman.

A Post-Retirement Venture Can Keep You Healthy

Dale Olsen, a 71-year-old man who started SIMmersion, a technology services and e-learning business after retiring, echoes Boatman’s sentiment.

“It is almost impossible for any business to remain a side business,” says Olsen. “If you love it, a business becomes all consuming. If you don’t, it will fail.”

Olsen has been running his business for more than 11 years and scaled his organization to 10 employees.

“I am excited to go to work every day,” Olsen says. “That adds much to my life.”

Olsen’s business empowers him to be productive and creative. He feels that his venture has improved his self worth, boosted his cognitive capability and provided much-needed social activity.

“For many, the extra income is essential, but there are the under-appreciated benefits listed also,” Olsen says. “It’s well known that staying youthful, living longer and thinking more clearly requires social interactions, mental challenges and physical exercise.”

Boatman also found that income was only part of the equation. What had once been her freelance hobby has now become a path to a more fulfilling future. “I pursued a side business as part of my retirement strategy because I am not physically or mentally ready to retire.”

Ritika Puri specializes in business, marketing, entrepreneurship and tech. She writes for American Express OPEN Forum, Forbes, Investopedia, Business Insider, CMO, the SAP Innovation Blog, and others.